In New South Wales law it is possible to become the owner of land by ‘adverse possession’ often referred to as ‘squatters’ rights’, allowing someone to legally take ownership of land they have occupied exclusively for at least 12 years.
Henry Downie died in 1947, without leaving a will. One of the assets that Henry owned was a property at 6 Malleny Street, Ashbury (“the property”). The property was let to Mrs Grimes as a “protected tenant”, who periodically paid the small amount of rent to a real estate agent. Mrs Grimes remained in occupation of the property until shortly prior to her death in April 1998.
Following Mrs Grimes’ death, the property was vacant for a time. Bill Gertos an accountant came to notice the property when he went to the street to visit clients for whom he prepared tax returns. The property appeared to be unoccupied and falling into disrepair. Over the course of the following year, it appeared to him that the building was empty and that no one was maintaining it.
Bill took possession of the property in late 1998 and has maintained possession ever since. Bill gave evidence that he had heard about adverse possession in his professional dealings and in 1998 had it in the back of his mind
“that this may be a case where it may be possible to obtain title to the property by possession of it over a sufficiently long period of time if nobody else was interested in it”.
Bill instructed a solicitor to ascertain the name of the owner, whether the owner was alive, and if not whether any grant of probate or administration had been made. The Solicitor advised Bill if he could prove to the Registrar General that he had occupied the property, paid the bills, and looked after it as if it was his own for at least 12 years, or perhaps 14 years he could request registration as the owner of the property.
In 2017, Bill made an application to be recorded as the owner of the land.
An applicant for a title on the grounds of possession must support the claim by a plan of a survey to establish the area of enclosure, and by statutory declarations from several uninterested persons testifying to the extent and nature of the occupancy relied on. The applicant should also demonstrate who, but for his possession, would be entitled to the land.
In October 2017, the Registrar-General gave notice of its intention to grant the application made by Bill.
In November 2017 Henry’s daughter and two grandchildren (“the plaintiffs”) commenced proceedings seeking a declaration that they were the beneficial owners of the property.
The plaintiffs accepted that they were not bringing their claim on behalf of Henry’s estate but on the basis that they were persons entitled to take on intestacy and thus had a chose in action to see that the estate was duly administered
Bill submitted that the plaintiffs lacked standing and that as he had been in adverse possession of the property since about late 1998 any claim to recover the land from him would be barred. The plaintiffs take issue with those contentions claiming that Bill did not form the necessary intention to possess the property either at all or until recent years.
The Court applied the principles that apply in adverse possession matters
Possession which will cause time to run under the Act is possession which is open, not secret; peaceful, not by force; and adverse, not by consent of the true owner…,
Bill openly advertised the Ashbury property as being for rent, paid council rates and arranged for a real estate agent to manage the property.
The Court was satisfied that Bill was in possession of the land since about late 1998 can be regarded as open, not secret; peaceful, not by force; and adverse, not by consent of the true owner. It has continued without interruption to the present day accepting;
- in 1998 Bill concluded that the property was not occupied, and after carrying out an inspection, decided to take possession of it himself.
- that he then took steps to secure the property, had the locks changed, and had some works carried out to make the property habitable.
- that he then set about renting the property to tenants through an agent appointed for that purpose.
- that over the years that followed the property was let by him, on a more or less continuous basis, to a series of tenants.
- that he undertook the payment of the rates and charges, and land tax, in respect of the property, and further made payments for insurance and maintenance.
- that he expended more than $100,000 in 2014 in effecting substantial works at the property.
- that the income and expenses in relation to the property were included within his tax returns throughout.
- that his entitlement to assert a possessory title was disclosed in the course of his Family Court proceedings.
In dismissing the plaintiffs claim the Court was unable to accept that they were the rightful owners of the property. Accordingly, the plaintiffs application for relief was refused and they were ordered to pay Bill’s court costs.